SINGAPORE, Sept 25 (Reuters) - Demand for U.S. light sweet crude is set to rise amid changes in sulphur specifications for refined products like fuel oil and as shale producers continue to drill for more crude, an executive from U.S. pipeline firm Enterprise Products said on Monday.
“The (crude oil) barrels have to clear across the water ... To the demand in Asia, to the demand in Europe,” Brent Secrest, senior vice president at Enterprise Products, said at an industry event in Singapore.
U.S. crude oil production has spiked following the shale oil revolution in the late-2000s, leading to a glut in domestic crude supplies, with U.S. refiners are geared towards processing heavier crude with higher sulphur content.
Enterprise currently exports around 100,000 barrels per day of crude oil from the U.S. Gulf coast, Secrest said.
More U.S. crude oil exports are also expected as U.S. refiners are not looking to change their refinery configurations to accommodate domestic light sweet crude oil, Secrest added.
A new sulphur specification for shipping fuels that will begin in 2020 is set to boost demand for U.S. crude that has a low-sulphur content.
”(The) solution is light sweet crude oil that we have to offer, Secrest said.
The International Maritime Organization’s (IMO) tightened sulphur requirements for shipping fuels in October, which will see sulphur emissions fall from the current maximum of 3.5 percent of fuel content to 0.5 percent.
Refiners and the shipping sector have yet to decide on a way to deal with the stricter standards amid a myriad of solutions that include switching to gasoil or installing scrubbers to remove sulphur emissions from ships. (Reporting by Mark Tay; Editing by Joseph Radford)